11 Questions with… Bob Simpson, Abercrombie & Kent

LATTE chats with A&K's VP of Expedition Cruising

Based at Abercrombie & Kent‘s headquarters outside Chicago, Bob Simpson joined the luxury travel company in 1998 and over the past 20 years has worked his way up the ranks to his current position as Vice President, Expedition Cruising.

In Melbourne earlier this year enroute to Broome, LATTEspoke exclusively with Simpson to talk expedition cruising, one of the travel industry’s biggest growth sectors. In our lengthy conversation with Simpson, we explore topics such as the appeal of Antarctica, the growth of expedition cruising and its potential impact on the environment, Abercrombie & Kent’s association with PONANT, the company’s Philanthropic projects and whether or not another A&K owned and operated ship was under consideration.

Bob, welcome to Australia. You’re about to head to the Kimberley region. Is this your first time there and is this a new program for Abercrombie & Kent?Yeah, it is. It’s quite exciting. It’s something I’ve wanted to put into place and plan for quite a while. Historically we are best known for being an expedition company in the polar regions, which is certainly our bread and butter. But growing and getting into new areas – we’ve done a lot already, not too dissimilar. Over the years we’ve operated expeditions all through the South Pacific and New Zealand and Micronesia and Melanesia, up to Japan and up to the Russian Far East and within the Pacific side of the operation, but this will be the first time we’ve done the Kimberley and it’s something I’m really, really excited about. Something I’ve wanted to get in place for a long time.

It will be on Le Laperouse. This will be new for us to operate which is kind of exciting. We haven’t offered it to our guests in the past. PONANT has been operating in the region since last year. They have operated in the region with various ships. This year they have L’Austral. They are just about to wrap up for this year and then next year it will be on La Laperouse, so we are chartering and operating one of the dates next year with our A&K team.

What other regions of the world are relatively untapped for expedition cruising and are present growth opportunities for A&K?
We tend to grow our programs in the areas where we have the core expertise, so we create and do new variations of programs in the Arctic. A couple of years ago we launched our Northwest Passage voyage that now has become a perennial favourite for us each year. Each year we’ll incrementally grow in regions by coming up with a new itinerary or a new focus of enrichment. Some of the areas that we want to continue to grow are places like the Kimberley, and we’re looking at doing some development work in areas of Indonesia and the Indonesian islands as well. Any where where we can put together a delivery of enrichment, whether it’s culture, wildlife or specific enrichment areas that we can draw out and provide to the guest.

In your scouting trip to the Kimberley, will you be tagging on Indonesia?
Not on this trip. This one is really just fine tuning and making sure we have everything in place for next year for the Kimberley program. But Indonesia is one of the areas that we’re probably looking at for 2020. We usually are starting the planning about two years out and through the process of leading up to the year prior we are operationalising something, we spend a lot of the fine tuning. In many cases we’ll do two or multiple trips before we have everything in place. With the Kimberley it’s a little different and we’ll be able to do it in one time. I will have a team onboard that has a lot of years experience in operating in the region. But for us as a company in terms of chartering the ship and running it, it’s a good opportunity for me to able to make sure I feel that all the operational components are going to be in place and our team will have everything they need to deliver the program when we’re down in June next year.

Have you ever seen this segment of the cruise industry grow so fast? There seems to be a new expedition ship announced every second week at the moment.
Unquestionably we are definitely in a very robust period. There seems to be quite an optimistic outlook in terms of the expedition cruise segment. There’s a lot of projects in place. There’s a lot of projects that are being delivered. I think there’s some projects that may or may not come to fruition, but I think overall there’s a good 20-30% capacity growth potential in the expedition cruise sector over the next four-to-six years, so it’s quite remarkable. And I think there is a lot of optimism. I think there’s a view that the demand is there, and I can tell you that most of my contemporaries – they are competitors but we are close community, especially when it comes to expedition cruise operators. We all know each other well and quite frankly, we work in many cases very closely together. For example when you look at Antarctica, all of us as operators, we’re pretty much without exception all members of IATO – an organisation of all companies that operate in the Antarctic. We all work very collaboratively and closely together, so there’s a close connection. I’m quite sure that the majority of the ships are operating at near full capacity, so that optimism of demand is definitely there.

With this influx could the expedition market be over-saturated in places like Antarctica and the Kimberley? Will it reach a point similar to the European river cruise market where at some ports guests needs to cross through other vessels to disembark?
Well that’s the million dollar question. To this point and up until this year, I was the chair of the executive committee for IATO. For the three previous years leading up to this last year and I can tell you that one of the key elements of our focus has been on being very proactive in insuring that we are managing for the growth. And to this point we’ve been able to do that very effectively.

I think there is a potential tipping point. I don’t think we are there yet, even in the near term. And part of that collaboration and community of cooperation is what helps us to do that. When we schedule and organise our programs we work around a scheduling system that enables us to still maintain what we call a “wilderness experience”. But it has changed. There is no question about it. It is a key thing that we’re definitely looking at to make sure we are doing it the right way. It’s a similar situation in certain areas of the Arctic as well, that it has to be done very carefully and very measured, so that the growth of the number of ships and the number of passengers that are going ashore, and all those things, that’s it’s done in a very managed way. Something that we are all keeping an eye on, that’s for sure.

What are some of the trends you are seeing in the expedition cruise market?
The focus on and the evolution of the hardware has been quite interesting. If you look at the instances of some of the new ships that have either been planned and announced and those that have actually been delivered as well. The category of ships that are available for guests and the options that are available for guests in terms of the level of luxury and amenity and things like that, are what I’d say a relatively new phenomenon. Certainly within the last six-to-eight years or so.

The increasing trend that I’m seeing is at that premium level. That’s no secret that a lot of the new builds are targeting that segment of the market as well.

Activities is something else that I think is more and more part of the trending in having a variety of activities that people have available for them, both on and off the ship. Off the ship in particular, I’m thinking Antarctica in particular where there is a trend in increasing activities of off-ship options, such as sea kayaking, and in some cases there are some companies offering camping opportunities for guests. Other more active types of elements or opportunities for guests as well that are trending in product growth. Every company has a different level as to where their clients’ fit and in terms of the things that clients are coming to them seeking.

For A&K, our focus is really more on the educational and enrichment side of the equation. We certainly offer a level of activity that lets the guest have a full immersive experience but a lot of our focus and investment of our product is really in terms of our personnel expertise and enriching staff that are delivering the guest experience. For the most part, A&K guests aren’t looking to spend the night in a tent, laying in a sleeping bag on the continent somewhere! They just want to be able to have a full, enriching experience, but are more inclined to want to get back to the nice levels of amenity offered aboard the ship. There is a bit of something for everyone and that’s increasing the trend, continuing to offer more types of elements in terms of activities and excursions.

What are your thoughts on expedition lines offering helicopter and submarines onboard. Is that something A&K supports. Do you have a particular position on that?
I’m a little mixed. Part of what I said earlier about the ability for all of us to be able to offer a wilderness experience for guests, a lot of that has to do with the ability to provide a solitude experience as well.

I have to be honest to say that I have some level of concern with the prospect of the advent of helicopters and things like that. Not only the potential impact on the environment but I think also the potential impact on guest experience. At the end of the day, our guests want to feel like that they are in a place that is unique. I mentioned before about the wilderness experience – a very specific aim that we all have – but all of a sudden if you’ve got helicopters zooming around, that kind of has an impact on that. That’s part of it.

The submersibles – it’s not that I’m not in favour of it – I just don’t think that our clients are looking at that activity and so the ships that we are inclined to strategically charter, that’s not one of the areas of key importance for us to have onboard. I think there are operational challenges with that as well. I’m not 100% sold that we all feel comfortable that there’s not going to be a potential impact on the environment in some of the areas that there are plans for these things to be operating as well.

So it’s not that I’m not in favour of it, I’m certainly in favour of a safe operation of any type of activity that would be permitted, but it’s got to be done very carefully and it’s just not something in our wheelhouse of expertise to even want to take on.

Can you tell me more about the A&K Philanthropic journeys?
For me, that’s something that is very important. It’s something that I personally, in my position, spend a lot of time in developing and implementing on our programs. We have Abercrombie & Kent Philanthropy (AKP) projects globally. Anywhere we have infrastructure and that we’re operating that includes our expedition programs. That’s something that we implement on a destination by destination basis.

We have a number of consistent projects. One is for Antarctica and one that has a wildlife conservation focus and is working through an organisation called ACAP (the Agreement for Conservation of Albatross and Petrels). It is centred around conservation for the diving seabirds, particularly Albatross, in that there is an inherent conflict between conservation efforts and groups and the longline fishing industries.

There are three primary activities that occur in the Antarctic. One is science and research, which are the national Antarctic programs and science programs. The others are tourism and the third is fishing and fisheries.

So the longline fishing industry, just by nature of the process, has created a significant hazard for diving seabirds in that the baited hooks on the long lines are typically at a depth that is within range of the diving seabirds. They get hooked going after the baits and there’s a relative high mortality rate of the petrels and albatross in particular in the Southern Ocean. The project that ACAP has been working on for a number of years now – that we’ve been very active and financially supporting – is a device that has been created that is a bait pod protector. This is a great example of cooperation between commercial industry interests and conservation efforts – in that it was a win-win for both sides. The bait pod, once it was created and implemented, it was proven that the cost of the fisheries to buy this bait pods and use them actually was a positive financial impact for the companies because they greatly increased their yield of catch, but also significantly eliminated the number of birds that were getting caught in the hooks. This is problematic two ways, from an environmental conservation standpoint, but it’s also problematic from a commercial view for the fisheries because they’re out there to catch fish, not birds. Every time a bird was caught it disrupted their fishing operations. It was a very cooperative effort and it took a lot of financial process, so for the last 10 years that we have been raising funds and supporting ACAP with this whole project, so that’s one project that A&K has been very active with.

The other is on the climate research side and citizen science and science support. We have an affiliation with a US professor who has 35 years of research at the US Palmer Station in Antarctica and is affiliated with the US National Science Foundation, focused on ocean acidification and how climate change has impacted the food chain in particular the population of penguin rookeries in certain areas of the Antarctic Peninsula and so we have worked with Dr McClintock for about 12 years and every year we have allocated budget to purchase and acquire equipment that they need for their ongoing research at Palmer Station. Each year we deliver it when we are down there during our Antarctic season. We’ve delivered around US$350,000 worth of science research equipment that they’ve used and its all different types – from HD cameras to electronic satellite penguin tags, to webcams that are monitoring penguin rookeries, and other high-tech stuff.

So we set a budget, we go to Dr McClintock each year, he goes back to his research associates and determines what it is they need and what we have in our budget and they’ll prioritise requirements. At the end of the day for our Antarctic program when we go to Palmer and deliver the equipment it’s something very interactive for our guests as well and they are involved in the delivery of the equipment, they meet with the scientists and they get a chance to actually see some of the results of the projects they are carrying out.

One other project that I’m very passionate about is on the community and cultural support that we offer for our Northwest Passage, where we operate annually. One of staff members is a musician from Canada and he has a non-profit organisation called ArtsCan Circle which he has been operating for the past 10 years. He identifies some of the remote inuit communities where there is a historical, very significant problem with substance abuse by youth. In particular they get hooked on sniffing gasoline. It’s a high risk problem for the youth in these communities and so a number of years ago, Mike Stephens (our staff member who is on the voyage each year for the Northwest Passage), has aligned with a number of these communities where he delivers musical equipment and musical education as an alternative. He gets kids engaged in music as an alternative and it has been very, very effective. And so each year, and in particular in the community of Gjoa Haven (which is in Nunavet), we deliver a bunch of harmonicas, and over the years these kids have gotten very very engaged and the level of success that has been created to get kids engaged in music education and opportunities has been really tremendous. Thats another example of A&K’s community support and engagement.

What is the pull of Antarctica, especially for luxury travellers?It’s interesting. I’ve been doing this for 20 years and I can still remember in February of 1998, it was three days after I started a job with A&K in expedition cruising and I was off to Antarctica. I grew up in Texas and I remember talking with a couple of my friends, telling them I’m heading to Antarctica next week and their reaction was “are you out of your mind? Why would anyone want to go there?”

I think it’s interesting because Antarctica has become a very mainstream destination now. A lot of that has to do with the growth of the number of ships and the awareness of the destination. And now there’s different options. And there’s big ships. You can go down on a Princess Cruises’ ship and do a cruise-by, and so there’s a lot of awareness of Antarctica.

It’s really a very attainable destination in that regard, but in terms of why and what I think is really still the amazing part is that it is just flat-out the most amazing wildlife destination in the world. For a company like ours where there are a lot of arguments to be made about East Africa or the Galapagos or some of these other places, for me it’s just because of two things. One is just the sheer volume. The numbers of species and the quantity within some of these areas of individual animals, particularly birds, and when it comes down to it, the variety of penguins, that is just quite astounding.

It is one place also that we have to be very careful that we are following guidelines of conduct in terms of the interaction with wildlife because at the end of the day you could easily get right up to them because they don’t have any natural fear of predation, especially on land. There is in the water but not on the land. And so we have guidelines in terms of distance but the amount of wildlife that is there is just unbelievable. And its not just birdlife, the marine mammals as well. Some of the greatest whale and seal watching opportunities are in Antarctica, just the abundance is astounding.

There are so many pieces to it. The history, it’s still very iconic and going to some of the places 80 years ago it was unattainable. And when you think of it the expedition cruising and its evolution to be able to reach locations like Antarctica. Really it started with a ship that we previously owned called the Explorer, the ”Little Red Ship”. That was from 1990 to 2003 that we owned and operated the Explorer. That was the original ship built as an expedition vessel. It was built by Lars-Eric Lindblad and his idea.

Up until that point if someone wanted to go to Antarctica it would be an extremely expensive proposition. You would have to charter a ship, put together a crew, it would be like going back to the old explorer days like Shackleton and you would to fund the expedition to be able to go. Whereas Lindblad thought if I build the ship and I just sell the cabins, that was the formation of what now is fuelling the amazing boom in growth of this segment of the travel industry. And it really all started with that. There were a lot of people that want to be able to go to these amazing, remarkable places. For me, Antarctica is top of the bucket-list that people just want to be able to tick off. And for many people on any given voyage, Antarctica was their final continent to explore.

You mentioned A&K previously had a ship. Are you winning your argument to try and secure another expedition ship?
No, and to the contrary, I was the biggest proponent for us to not own and operate a ship, for a couple of reasons. Because of the evolution of hardware, I think it’s important for A&K to have flexibility to be able to make sure that we are able to be aligned with the best product that fits for what we want to do and how we want to operate. Intuitively, that may seem to indicate that it’s better to have your own ship. But then you are locked in and things change and market changes.

And the other is, quite frankly, we are not a cruise line. When we owned and operated the Explorer it wasn’t a very profitable position for us because we had one ship. It was a single-ship operation. We didn’t have the desire to grow into a full cruise company and so, based on that, based on a single-ship operation, it is extremely difficult to make it very profitable. So for A&K, what’s more important is that we are really strategic and specific in terms of where we want to operate and the timing that we want to operate as well. So that lends to being able to selectively charter the ships, which is what we do, and we now approach it that way, where we are chartering the hardware.

In the case of our partnership with PONANT, PONANT operates their own programs, but the only common element is the ship. They charter the ship to us, which is what we want. We want the crew onboard, and we do everything else. We put our software (expedition team and staff), our enrichment program, our brand, our standard of operation is all done by A&K. So it works quite well to be able to do that very selectively on the ships in the places and times that we want to be operating our programs.

And finally Bob, are you talking with Crystal about chartering their luxury expedition ship, Crystal Endeavour?
We have a very good and symbiotic relationship with PONANT. It’s a good fit for a couple of reasons. One is that the hardware, in my opinion, is an ideal fit for our type of product and our type of guest expectation. And it has worked very well. And as they have grown their fleet it has given us a good opportunity to grow what we are doing as well. Having said all that, we don’t have a joint venture or a commercial exclusivity or tie, so I am always in conversation with a number of companies, and continue to do so. We all know each other, so I have good working and personal relationships with other companies, and even competitors, that we always maintain the dialogue, and if and when the time would fit that there is a particular opportunity for a ship in a place that is a good fit for us, we are absolutely open to continuing to have the opportunity.

There’s nothing imminent but there’s always the possibility there could be an alignment that works better for us in one way or another.